In my last post, Change the Right Things, not Everything, I highlighted how Intel shifted away from the memory business and into the microprocessor business full time. Andy Grove and Gordon Moore concluded that this was the correct decision when Grove zoomed out – as Jim Collins and Morten T. Hansen in Great by Choice call it – by posing his question about what a new CEO would do in their place.
Collins and Hansen adopted the terms zoom out and zoom in to capture a duality they observed in “10X” leaders. These leaders have the capability of remaining “obsessively focused on their objectives and hypervigilant about changes in their environment.”
Zooming out in a leadership context is about sensing changes in business conditions, the time frame involved, and the risk – ultimately leading to an assessment as to whether new conditions will call for disrupting existing plans. Zooming in, on the other hand, is all about “supreme execution of plans and objectives.” But there is another flavor of zooming in and out.
In his book The Lean Startup, Eric Ries uses the terms similarly in that they help guide meaningful change while conducting what he calls a pivot. Ries describes what David Binetti, CEO of Votizen, did using a series of pivots, ultimately turning Votizen away from being a full social network towards a voter contact product using what Ries calls a Zoom-in Pivot.
A Zoom-in Pivot describes a situation where what previously was considered a single feature in a product becomes the whole product. Why? Because the other features failed to provide any real value to the customers and consequently to Votizen; the other features didn’t aid in customer retention or customer referrals, nor were they features that customers were willing to pay for. David Binetti simplified his offering, narrowing the focus and finding a profitable niche through a rigorous and disciplined approach.
A Zoom-out Pivot describes the reverse scenario, where a single feature is deemed insufficient to be an entire product or business in its own right. In this case, a what was considered to be the entire product becomes a single feature of a much larger product.
What a pivot is not is a change for the sake of change. It is a structured change to test a new hypothesis about a product, business model, and growth engine. The objective is to fire bullets (as Collins and Hansen say in Great by Choice). Ultimately, pivoting is just what Intel did, and for good reason. Staying the course in memories would have been an unprofitable, difficult battle.
As The Lean Startup tells us, “…there is no bigger destroyer of creative potential than the misguided decision to persevere. Companies that cannot bring themselves to pivot to a new direction on the basis of feedback from the marketplace can get stuck in the land of the living dead, neither growing enough nor dying, consuming resources and commitment from employees and other stakeholders but not moving ahead.”